IR35

An introduction to IR35

For many years, people leaving jobs to become self-employed were advised to instead set up one man companies to provide their services; offering the security of a limited liability company and significant national insurance savings. We offer a brief introduction into IR35.

Who is caught by these rules?

The IR35 rules aim to catch anyone who, by placing an intermediary between himself and his employer, gains some tax (including national insurance contributions) advantage.

How can I avoid it?

There are several ways you can avoid IR35, although they may not be palatable to you or your customers.

The problem with deemed payments

If you have established that some of your work will be caught by IR35, PAYE tax and national insurance will have to be accounted for on a deemed salary payment at 6 April 2020.

IR35 and cessations

In this series of IR35 guides you will be able to consider the impact of IR35 and the effect it has on those workers providing their services through intermediaries.

Personal service companies

The legislation known as IR35 is intended to tackle the avoidance of tax and national insurance contributions through the use of intermediaries such as service companies or partnerships.

Off-payroll working in the public sector

The responsibilities for deciding when IR35 applies have changed for contractors engaged by or for the public sector.

The construction industry

There are special tax rules affecting the construction industry, which are designed to ensure that tax is paid by workers in the sector whether they are employed or self employed.

Interest and tax payments

HMRC charge interest on underpayments of tax, and pays interest (repayment supplement) on overpayments.